2014 (6) TMI 827 - HC - Central Excise

Validity of Tribunal s order - Ex parte order passed - Held that - On the application for modification of the earlier order, the Tribunal found that it was listed on 17th April 2012. On that date, a written request was filed to list the application on 18th April 2012. Therefore, on the Appellant s written request, the matter was postponed to 18th April 2012. On the postponed date, none appeared on behalf of the Appellant meaning thereby both the Appellant and Advocates were absent. In such circumstances, the Tribunal cannot be faulted for proceeding ex-parte. Waiver of pre deposit - Clandestine production and removal of goods - Held that - Prima facie, the Tribunal found that the demand was based on the Appellant s contradictions noted in the books of accounts. The adjudicating authority, prima facie, took into consideration the other material as well. In these circumstances, the Tribunal found that this is not a case of complete waiver of pre-deposit but a partial one. We do not find that the direction to deposit a sum of ₹ 38,00,000/- out of the total demand of ₹ 2,30,36,528/- can be said to be unreasonable, arbitrary, leave alone capricious, enabling us to exercise our jurisdiction. The Appeal does not raise any substantial question of law and it is, accordingly, dismissed - decided against assessee.

Issues:
1. Dismissal of modification application by Tribunal without hearing the Appellant or the Advocate.
2. Allegation of breach of natural justice principles.
3. Huge sum deposit as a pre-condition for hearing the Appeal on merits.
4. Harshness of interim direction on the Appellant.
5. Basis of demand and partial waiver of pre-deposit.
6. Exercise of appellate jurisdiction by the High Court.

Analysis:

1. The Appellant challenged the Tribunal's order dismissing an application to modify its earlier interim direction. The Appellant contended that the modification application was dismissed without hearing them or their Advocate, breaching the principles of natural justice. This lack of hearing was argued to be a substantial question of law warranting appellate jurisdiction.

2. The High Court examined the circumstances surrounding the dismissal of the modification application. It was observed that the application was listed for a specific date, but on that day, both the Appellant and their Advocate were absent. The Tribunal proceeded ex-parte due to their absence, leading to the dismissal of the application. The Court found no fault with the Tribunal's decision in these circumstances.

3. The Appellant also raised concerns about the hefty sum required to be deposited before the Appeal could be heard on merits. The Court assessed the interim direction and found it not unreasonably harsh. The demand was based on contradictions in the Appellant's accounts, and the Tribunal had partially waived the pre-deposit amount. The Court concluded that the deposit requirement was not arbitrary, unreasonable, or capricious.

4. It was argued that the demand was solely based on electricity consumption, but the Tribunal found that it was also related to discrepancies in the Appellant's accounts. The Court upheld the Tribunal's decision regarding the partial waiver of the pre-deposit amount, deeming it justified based on the available evidence. Consequently, the Appeal was dismissed as it did not raise any substantial question of law.

5. The High Court clarified that if the Appellant complied by depositing the specified sum within eight weeks, the Tribunal would revive and dispose of the Appeal on its merits. Failure to comply would result in the dismissal of the Appeal standing as ordered. The judgment emphasized the importance of following due process and complying with the Tribunal's directives for the proper adjudication of the case.

← Previous Next →